Deck 3: Financial Concepts and Regulations in the Money Market

Question 1

Which of the following was set up mainly for providing finance to private sector?

A)IDBI
B)IFCI
C)ICICI
D)all of these

Answer 1

ICICI

Question 2

Interest rate in the money market funds are

A)Determined by the RBI
B)determined by the SBI
C)Determined by the market forces
D)none of these

Answer 2

Determined by the market forces

Question 3

Money market include

A)Only organized players
B)only unorganized players
C)both organized and unorganized players

Answer 3

both organized and unorganized players

Question 4

Income - Expenses = -------------.

A)Savings
B)investment
C)money
D)none of these

Question 5

------------- is postponement of current consumption

A)money
B)savings
C)investments
D)all of these

Question 6

-------------.means a number of securities/assets put together.

A)Investment
B)portfolio
C)savings
D)none of these

Question 7

Debenture trading is ------------- in India.

A)popular
B)not popular
C)prohibited
D)none of these

Question 8

Debt instruments which have a maturity of less than one year called -------------.

A)Secondary market instruments
B)money market instruments
C)capital market instruments
D)none of these

Question 9

------------- is a vehicle to get entry into the asset classes.

A)Capital market
B)Mutual fund
C)Debt market
D)all of these

Question 10

-------------- creates high risk and is illegal.

A)Speculation
B)Gambling
C)Investment
D)all of these

Question 11

The pivotal position in the Indian money market is adorned by

A)Commercial bank
B)non banking financial companies
C)RBI
D)none of these

Question 12

The rate at which RBI lends short term funds to bank is

A)Reverse repo rate
B)repo rate
C)interest rate
D)none of these

Question 13

The proportion of deposits that banks have to keep with RBI is

A)CRR
B)SLR
C)PLR
D)none of these

Question 14

for issuing commercial papers

A)Prior approval of RBI is not required
B)Prior approval of RBI is required
C)Prior approval of SEBI is required
D)None of these

Question 15

For issuing commercial papers,

A)Credit rating is a must
B)credit rating is optional
C)underwriting is a must
D)None of these

Question 16

Money market instruments have a maturity of

A)Less than one year
B)Less than six months
C)More than one year
D)None of these

Question 17

Debt market instruments have a maturity of

A)Less than one year
B)Less than six months
C)More than one year
D)None of these

Question 18

Irredeemable bond is also known as

A)Fully convertible bond
B)Perpetual bond
C)Partially convertible bond
D)None of these

Question 19

Floating rate bonds carry

A)Fixed rate of interest
B)Varying rate of interest
C)Zero rate of interest
D)None of these

Question 20

Zero coupon bonds mean

A)Fixed rate of interest
B)Zero rate of interest
C)Higher rate of interest
D)None of these

Question 21

Callable bonds mean

A)Subscriber has the right to demand money before the time
B)Issue has the right to redeem before the time
C)Investor can request for redemption any time
D)None of these

Question 22

If the credit quality of the issuer deteriorates, market expects

A)Lesser rate of interest
B)Higher rate of interest
C)Zero rate of interest
D)None of these